Abstract Depression is costly and has detrimental effects on disease course in physically ill populations. This proposal takes a novel multi-dimensional approach to assess the neurobiological basis of depression in chronic pediatric physical illness using inflammatory bowel disease (IBD) as a model. It also evaluates the efficacy of a modified cognitive behavioral therapy (CBT) on emotional well-being, physical health, economic costs, and neurobiological outcomes. These results will provide key building blocks for a paradigm shift within medicine by integrating behavioral health into the comprehensive medical care of physical illnesses. Little is known about how the brain and body interact to increase depressive vulnerability, particularly during key developmental periods during childhood and adolescence. Adult studies identify disruptions in limbic and prefrontal brain activity in the pathophysiology of depression. Cytokines secondary to inflammation and exogenous treatment with steroids can cause mood and cognitive changes in these same brain regions. It is important to understand the neuropsychiatric effects of IBD and its treatment on underlying brain structures during adolescence, a critical developmental period for brain maturation underlying emotional regulation and cognitive processing. More importantly, neuronal plasticity during adolescence may still allow reversibility of disease-related brain effects through teaching coping strategies for life-long illness management that could change developmental trajectories and reduce vulnerability in adulthood. Using translational neuroscience approaches, this proposal will examine: 1) brain regions that underlie emotional and cognitive processing in youth with active IBD and depression using brain functional magnetic resonance imaging compared to youth with IBD and no depression, and normal controls;and 2) the efficacy of a combined CBT-physical illness narrative intervention targeting emotional and cognitive processing compared to supportive non-directive therapy at: (a) improving emotional well being;(b) alleviating physical symptoms; and (c) reducing health care costs.